Crypto-based donations will reportedly be legally authorized for candidates for California-based state and offices, following the removal of the barring from 2018.

Specifically, California was reportedly among the nine states that agreed on a prohibition regarding crypto-based political contributions, citing reasons related to perceived transparency and Know Your Customer (KYC) at the time. 

The matter of contributions in crypto was brought back to life in March this year, following the generation of commission regarding a perspective on the sale of nonfungible tokens (NFTs) for campaign fundraising.

In May, the FPPC reportedly put together a report focusing on the examination of three selections for its crypto policy, including maintaining the prohibition or considering crypto cash, with a $100 contribution cap, as currently employed in numerous states.

The final option was reported to view crypto as an in-kind contribution, similar to a good or service instead of money, making it mandatory to have the contribution come via a processor which employs KYC protocols, and the contribution is converted into fiat within two business days of receipt. 

The value of the contribution would be the dollar exchange rate of the crypto on the day of transfer.

The FPPC reportedly granted approval for the third option in its confirmation on July 21st. California is now one of 12 states that explicitly made it legally possible for political contributions in cryptocurrency. The decision will be officially enacted in 60 days.

California has reportedly been taking a leading role when it comes to crypto adoption in other arenas. In February, legislation was proposed to the state Senate to grant the regulatory greenlight for crypto-enabled payment for state government services. 

Said legislation did not manage to snatch a committee vote but was given a rehearing that has not happened. Governor Gavin Newsom issued an executive order in May to harmonize state regulations with President Joe Biden’s executive order on digital assets.